The Vehicle Importers Association of Sri Lanka (VIASL) has responded to recent remarks by Prof. Anil Jayantha, noting that while the industry would welcome any reduction in customs duties or related taxes, the current trajectory indicates otherwise.
The Association emphasized that one of its key budget proposals was to charge the Social Security Contribution Levy (SSCL) at the point of import, particularly because many one-time personal importers were avoiding the tax under the existing system.
According to the Association, the practical impact of shifting SSCL to the import stage has not been fully understood by the public. At present, SSCL is charged at the point of sale, where the 2.5% levy is effectively halved to 1.25%, as the calculation is based on 50% of turnover, in line with the relevant Inland Revenue provisions.
However, from 1 April 2026, the situation will change significantly. As stated on the Inland Revenue Department’s website, SSCL will be collected at the point of import and calculated on 100% of turnover, meaning the full 2.5% will be applied instead of the reduced 1.25% currently paid.
In addition, this full SSCL amount will be incorporated into the base value used to calculate VAT, resulting in a further 18% VAT being charged on top of the SSCL, VIASL said.
Deputy Minister of Finance and Planning Prof. Anil Jayantha previously said that recent claims regarding a tax hike on vehicle imports are largely misleading tactics used by sellers to create public fear.
Speaking to the media on Monday, he explained that rather than introducing a new tax, the government has shifted the point of collection for the Social Security Contribution Levy (SSCL) from the point of sale to the initial customs stage. (NewsWire)